Interview : The Impact of Personalized Medicine on Emerging Markets

PM is still quite new and very much in its stages of infancy, globally. Upper middle class and the wealthy can “jump-start” PM based on out-of-pocket payment driven use. As the market grows in size over time, it could then become more affordable for the masses.Updated: August 13, 2015, 14:15 IST

Prashant Yadav , Senior Fellow at the William Davidson Institute and a Faculty at the Ross School of Business at the University of Michigan tells Arunima Rajan that emerging markets can reap huge benefits from personalized medicine.

When we hear about personalized medicine (PM) we think it is a futuristic concept which is still limited to the confines of large academic medical centers in the US and Europe. Do you think it is too early to start thinking about PM in India and emerging markets?

PM is still quite new and very much in its stages of infancy, globally. However, I believe that PM may have a rapid uptake in India and some other emerging markets. For PM to truly take off and become mainstream in the US and EU, many actors in the eco-system e.g. third-party payers, public policy decision makers, regulators, patient information technology platforms, and physicians/hospital groups have to all align together. Often these players have divergent agendas.

The complex system of payments and reimbursements for medicines implies that insurers need to approve the widespread use of a new PM product and its pricing. The need to control costs translates into more onerous burden of proof for early innovators in PM. The buying clout of the payers also keeps prices low, which helps the patients in some ways, but impedes wide scale use of PM in the early days. Regulatory agencies in the US and EU have only recently started to keep pace with innovation in this field. Traditionally they were using decades old regulatory science which was in a way contributing to slower use of personalized medicine. Collectively, this impedes the faster adoption of PM in developed country health systems.

In India there is lack of strong players in some of the roles in the healthcare eco-system. While this hinders effective accountability, efficiency and hurts patients in some ways, this could well be a factor that contributes to the faster adoption of new health technologies such as PM. Customer/patient focused innovation can have a better starting ground in markets which have fragmented payer systems. A product’s value in the market is based more directly on a patient’s willingness to pay and not on perceptions of value as assessed by a third party- e.g. a government or a private insurer. Upper middle class and the wealthy can “jump-start” PM based on out-of-pocket payment driven use. As the market grows in size over time, it could then become more affordable for the masses.

There are also a large number of well-trained geneticists who can become important assets for PM to take off in India. Even culturally, the traditional systems of Indian medicine were much more customized to each patient. So acceptance of the idea that each patient needs a slightly different variant of the drug should not have any major cultural barriers. In fact, one of the reasons for lower acceptance of western style medicine for chronic diseases in India as I have heard from some patients I had interviewed was “the doctor gives the same medicine to everyone with symptoms like mine, but my “inner constitution” is different.”

What we need is a stronger alliance between the hospital sector and the laboratory networks to make PM work. How far along a lab network and a hospital are in this sphere could well become the key value differentiator for them over time. Technology platforms that allow collecting richer information about patients and can easily bring them to the doctor are also likely to be big winners in this.

Who will be winners and loser from PM if this takes off in a big way?

It’s hard to predict but the pharmaceutical industry, the lab networks and the advanced care hospitals all have to gain from PM. Within each area some will win and some will lose. Overall I think it creates a fundamentally different value proposition and some new alliances may form which will span the boundaries of lab, hospital, payers etc. These are the ones that are likely to gain the most.

The domestic pharma industry may initially feel that they would lose because most of the PM drugs will only bring revenue to large global life sciences companies. But over time I think the generic drug industry is likely to gain also. Treatment for HIV/AIDS where many generic companies are very active is now routinely based on subtype of HIV infection, and a patient’s response to the infection. They are slowly learning to work with smaller patient groups in other field even though it’s not truly PM.

Diagnostic test development is an industry that has barely taken off in India. The Department of Biotechnology is keen to see large leaps in the field of Diagnostics which enable PM. That is certainly a sector which will gain immensely from the growth of PM.

Overall, I think PM is an area which can create great opportunities to revitalize the Indian life sciences research sector. This could become a significant contributor to innovation growth. In debates about pricing and access we often ignore this element of PM.

Public health experts would argue that the prices of PM are such that population benefits will be small even if individual health benefits are large?

They are right that PM’s population health impact at least initially will be small. Even more so if it starts off with out-of-pocket payments from the wealthy and the upper middle class. However, we often discount the fact that diffusion of health technologies takes a long time before it truly reaches the masses and we are keen to see health technologies that can be used by all from day one. Too much focus on that utopian goal of everyone should have access to a health technology from the day it is launched can sometimes hinder the social diffusion processes that are at play.

The growing incidence of different types of cancers in India means that unless we can drastically improve the quality of outcomes and quality of life for patients with these conditions the population will have lesser trust in western style medicine. Once they see customized treatment and the value it brings, the next hurdle to cross will be how to make it more affordable through a combination of better third party reimbursement systems and lower prices.

You mentioned cancer. Is there a particular reason why PM is more likely to be used in oncology?

In a way PM started in oncology. Imatinib which is sold by Novartis as Gleevec was one of the first large scale PM drugs. That it has been the subject of a controversy in India is another matter which we don’t have time to get into in this interview. Rapid genome sequencing has allowed us to explore PM in almost all therapeutic areas. Since its start, cancer chemotherapy has been looking for more targeted agents to have greater effectiveness with less toxicity. As a result our understanding of the heterogeneity of disease is higher in this therapeutic areas. Biomarkers development has also been much faster in this area. This doesn’t mean though that other therapeutic areas are very far behind. Immunology and CNS disorders especially Alzheimer’ are likely to see strong potential from PM.

For India and emerging markets though the early years of PM may be limited to oncology. Cancer draws such strong public sentiment- from policy makers, from patients and their families, from politicians, and therefore from third party payers. Resources allocated to cancer- whether it is development budgets for drugs, biomarkers or diagnostics or reimbursement appetite- are higher for oncology than in other categories. This contributes to oncology being the early innovator in PM. Other diseases such as CNS and immune disorders are less recognized in emerging markets. They first have to overcome awareness barriers before PM can start enhancing clinical outcomes.

Subscribe ETHealthworld Newsletter

A bench of Chief Justice Rajendra Menon and Justice V K Rao passed the order while acting on a PIL filed by Delhi-based dermatologist Zaheer Ahmed who complained that lakhs of medicines were being sold on the internet every day without much regulation, posing a huge risk to patients and doctors alike.